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Message: Genco Increases Mining Reserves by 76% and Measured and Indicated Resources by 7
Genco Increases Mining Reserves by 76% and Measured and Indicated Resources by 751%
Trading Symbol TSX: GGC
VANCOUVER, June 17 /CNW Telbec/ - Genco Resources Ltd. announces the results of an updated resource and reserve audit for its La Guitarra silver/gold mine and Temascaltepec Mining District. Reserves and resources are reported as of March 2008 in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects. The Qualified Person under NI 43-101 for this reserve and resource estimate is Glenn R. Clark, P.Eng., of Glenn R. Clark and Associates Limited. He is arm's length to Genco and has prepared or supervised the preparation of the information that forms the basis for this news release and verified the data disclosed.
The following tabulates the reserve and resources by area and category. Approximately 200,000 tonnes of the underground reserves are included in the Creston block model resources.
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La Guitarra and Temascaltepec Silver Gold Mining District Reserves
and Resources
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tonnes Ag Au eAg
Category Area ('000) g/t g/t g/t
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Guitarra 226,000 209 1.89 304
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Proven Santa Ana 90,000 210 0.27 224
Reserves ------------------------------------------------------------
Nazareno 47,000 198 0.98 247
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Coloso 16,000 257 1.51 333
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Total Proven 379,000 210 1.38 279
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Guitarra 445,000 187 1.69 272
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Probable Santa Ana 430,000 190 0.21 201
Reserves ------------------------------------------------------------
Nazareno 90,000 178 0.55 206
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Coloso 82,000 258 1.49 333
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Total Probable 1,047,000 193 0.97 241
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Total P + P 1,426,000 198 1.08 251
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Creston Open Cut Resources - 20 g/t eAg Cutoff
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Measured 4,227,000 63 0.66 96
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Indicated 8,824,000 52 0.57 81
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Total M + I 13,051,000 56 0.60 86
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Inferred 3,469,000 48 0.71 84
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Underground Inferred Resources
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Ag Au eAg
Area tonnes g/t g/t g/t
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La Guitarra Down Dip 1,680,000 284 3.77 473
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La Guitarra SE 1,170,000 260 2.10 365
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La Guitarra NW Extension 1,100,000 284 3.77 473
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Santa Ana 2,070,000 252 0.32 268
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Ag Au eAg
Area tonnes g/t g/t g/t
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El Nuevo Descubrimiento 240,000 606 3.79 796
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Las Animas - Socorro 360,000 551 3.16 709
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Rincon 230,000 611 3.84 803
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Magdalena - Sayas 240,000 455 0.88 499
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Coloso 901,000 309 1.79 399
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Nazareno 1,922,000 267 0.48 291
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Purisima 110,000 551 3.16 709
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Total Underground Inferred 10,023,000 305 1.95 403
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Category Area oz Ag Oz Au Oz eAg
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Guitarra 1,519,000 13,700 2,204,000
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Proven Santa Ana 608,000 800 648,000
Reserves ------------------------------------------------------------
Nazareno 299,000 1,500 374,000
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Coloso 132,000 800 172,000
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Total Proven 2,558,000 16,800 3,398,000
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Guitarra 2,676,000 24,100 3,881,000
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Probable Santa Ana 2,627,000 2,900 2,772,000
Reserves ------------------------------------------------------------
Nazareno 515,000 1,600 595,000
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Coloso 680,000 3,900 875,000
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Total Probable 6,498,000 32,500 8,123,000
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Total P + P 9,056,000 49,200 11,516,000
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Creston Open Cut Resources - 20 g/t eAg Cutoff
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Measured 8,563,000 89,400 13,033,000
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Indicated 14,754,000 161,200 22,814,000
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Total M + I 23,317,000 250,600 35,847,000
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Inferred 5,350,000 79,000 9,300,000
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Underground Inferred Resources
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Area oz Ag Oz Au Oz eAg
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La Guitarra Down Dip 15,340,000 203,000 25,490,000
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La Guitarra SE 9,780,000 79,000 13,730,000
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La Guitarra NW Extension 10,050,000 133,000 16,700,000
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Santa Ana 16,770,000 21,000 17,820,000
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Area oz Ag Oz Au Oz eAg
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El Nuevo Descubrimiento 4,680,000 29,000 6,130,000
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Las Animas - Socorro 6,380,000 36,000 8,180,000
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Rincon 4,520,000 28,000 5,920,000
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Magdalena - Sayas 3,510,000 7,000 3,860,000
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Coloso 8,950,000 52,000 11,550,000
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Nazareno 16,500,000 30,000 18,000,000
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Purisima 1,950,000 11,000 2,500,000
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Total Underground Inferred 98,430,000 629,000 129,880,000
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Underground reserves were calculated using a 135 equivalent silver ("eAg")
grams per tonne ("g/t") cut off, a 20% dilution factor at zero grade.
Underground reserves were further reduced by 10% to reflect a mineable
recovery estimate. The methodology used for the underground reserves was
standard polygonal projections on longitudinal sections. Proven was projected
0-10 metres from data points and Probable was projected 10-25 metres for all
areas except Santa Ana. Proven at Santa Ana was projected 0-10 metres and
Probable 10-50 metres. Gold assays were cut to 15 g/t, and silver assays to
1,500 g/t.
The following tabulates the parameters used to create the Creston block
model grade interpolations.
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Parameter Value, Distance or Method
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Grade Estimation Method IDP3
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Block Size (length x width x bench Height) 10x3x3 metres
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Composite Length 3 metres
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Gold Outlier Cap 6 to 12 g/t depending on area
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Gold Outlier Capping Distance 15 metres
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Silver Outlier Cap 250 to 625 g/t depending on area
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Silver Outlier Capping Distance 15 metres
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Measured Distance 20 metres
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Minimum Number of Composites for Measured 2
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Indicated Projection Distance 20-50 metres
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Minimum Number of Composites for Iindicated 2
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Inferred Projection Distance + 50 metres
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Model Constraint 3D Solid/Wire Framing Model
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A 50 to 1 silver to gold ratio representing a gold price of US$600/oz gold
and a silver price of US$12/oz was used in the eAg calculation. Silver and
gold recoveries are essentially the same, 82%-89% using the existing flotation
circuit averages and in test work using cyanide leaching.
The following is a further breakdown of the Creston measured and indicated
resources at 10 g/t eAg intervals.
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Creston Resource by Class and Cutoff
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Cutoff Ag Au eAg
eAg g/t Class tonnes g/t g/t g/t
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Measured 6,145,000 46 0.47 70
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Indicated 11,435,000 42 0.45 65
0 ------------------------------------------------------------
M + I 17,580,000 43 0.46 66
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Inferred 4,590,000 38 0.55 66
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Measured 5,077,000 54 0.57 83
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Indicated 10,382,000 46 0.49 71
10 ------------------------------------------------------------
M + I 15,459,000 49 0.52 75
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Inferred 4,117,000 42 0.61 73
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Measured 4,227,000 63 0.66 96
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Indicated 8,824,000 52 0.57 81
20 ------------------------------------------------------------
M + I 13,051,000 56 0.60 86
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Inferred 3,469,000 48 0.71 84
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Measured 3,508,000 72 0.77 111
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Indicated 7,396,000 59 0.65 92
30 ------------------------------------------------------------
M + I 10,904,000 63 0.69 98
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Inferred 2,870,000 54 0.82 95
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Measured 3,033,000 80 0.86 123
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Indicated 6,179,000 66 0.73 103
40 ------------------------------------------------------------
M + I 9,212,000 71 0.77 109
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Inferred 2,382,000 61 0.93 108
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Measured 2,547,000 89 0.97 138
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Indicated 5,136,000 73 0.82 114
50 ------------------------------------------------------------
M + I 7,683,000 78 0.87 122
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Inferred 1,993,000 67 1.05 120
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Measured 2,162,000 98 1.09 153
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Indicated 4,226,000 81 0.93 128
60 ------------------------------------------------------------
M + I 6,388,000 87 0.98 136
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Inferred 1,710,000 72 1.17 130
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Cutoff
eAg g/t Class Oz Ag Oz Au Oz eAg
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Measured 9,089,000 93,500 13,764,000
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Indicated 15,443,000 165,500 23,718,000
0 ------------------------------------------------------------
M + I 24,532,000 259,000 37,482,000
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Inferred 5,608,000 81,200 9,668,000
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Measured 8,870,000 93,100 13,525,000
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Indicated 15,356,000 163,600 23,536,000
10 ------------------------------------------------------------
M + I 24,226,000 256,700 37,061,000
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Inferred 5,560,000 80,800 9,600,000
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Measured 8,563,000 89,700 13,048,000
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Indicated 14,754,000 161,700 22,839,000
20 ------------------------------------------------------------
M + I 23,317,000 251,400 35,887,000
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Inferred 5,354,000 79,200 9,314,000
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Measured 8,121,000 86,900 12,466,000
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Indicated 14,031,000 154,600 21,761,000
30 ------------------------------------------------------------
M + I 22,152,000 241,500 34,227,000
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Inferred 4,983,000 75,700 8,768,000
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Measured 7,802,000 83,900 11,997,000
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Indicated 13,113,000 145,000 20,363,000
40 ------------------------------------------------------------
M + I 20,915,000 228,900 32,360,000
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Inferred 4,672,000 71,200 8,232,000
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Measured 7,289,000 79,400 11,259,000
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Indicated 12,056,000 135,400 18,826,000
50 ------------------------------------------------------------
M + I 19,345,000 214,800 30,085,000
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Inferred 4,294,000 67,300 7,659,000
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Measured 6,813,000 75,800 10,603,000
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Indicated 11,007,000 126,400 17,327,000
60 ------------------------------------------------------------
M + I 17,820,000 202,200 27,930,000
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Inferred 3,959,000 64,200 7,169,000
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The following table shows the growth of resources and reserves by area and
category.
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Resource and Reserve Growth from End of 2006
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oz oz oz
Category tonnes Ag Au eAg
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Reserves 170% 74% 87% 76%
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Measured and Indicated 935% 723% 808% 751%
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Underground Inferred 72% 47% 18% 39%
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Genco's President Gregory K. Liller stated
"I extremely pleased with the large growth of both reserves and resources in the last year. Genco is executing its plan in a timely manner to develop the full potential of La Guitarra Mine and the Temascaltepec Mining District.
"These estimates will be incorporated into the ongoing feasibility study which is scheduled for completion in the third quarter of this year. The feasibility study will include an open pit mine and processing plan for the Creston deposit and I expect a significant amount of the 35.8 million equivalent silver ounces contained in the Creston measured and indicated resource to be converted to a proven and probable reserve.
"The feasibility study is on track to be completed in Q3 of 2008, and Kappes, Cassiday & Associates are focused on designing a suitable plant for the 3,000 t/d ball mill that we have already purchased. Vector Engineering is completing the design work for a tailings storage facility, a heap leach pad and associated ponds.
"We are assuming a positive outcome to the feasibility study and are currently exploring several project financing options including equity and debt. Genco remains focused and on track to greatly expand production at La Guitarra in 2010."
The Toronto Stock Exchange does not accept responsibility for the
adequacy or accuracy of this release.
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